SHANGHAI (Reuters) - Shares in China's biggest lithium battery maker Contemporary Amperex Technology Ltd (CATL) 300750.SZ soared 44 percent on their debut in Shenzhen on Monday, the maximum allowed for newly listed stocks on their first day of trade.
CATL, based in southeast China’s Fujian province, sold 217 million new shares, or 10 percent of its enlarged capital, at an initial price of 25.14 yuan ($3.92) each.
The battery giant is raising funds to finance a rapid expansion as Beijing aggressively promotes electric vehicles as a cleaner alternative to polluting fossil fuels.
Analysts with Samsung Securities said earlier this month that the IPO was expected to cover only half of the costs of its planned 24 gigawatt-hour capacity increase.
New energy vehicle sales in China more than doubled to 225,000 units in the first four months of 2018, according to industry ministry data. Lithium battery production in China rose 31 percent last year to hit 1.18 billion units.
However, experts have warned of the risks of overcapacity, with 102 firms now producing as many as 335 types of electric, hybrid and fuel cell vehicles throughout the country.
Reporting by David Stanway; Editing by Gopakumar Warrier
Our Standards: The Thomson Reuters Trust Principles.